VehshiCrypto

✅ Dogecoin is Not a Joke... it's dangerous

Dogecoin was created as a meme-coin forked from Bitcoin and made to be so ridiculous that no one could take it seriously. At the start, miners could earn anywhere from 0 to 1 billion coins for merely completing a single block - a random block reward lottery.

Developers tried to make it a bit less of a joke. In 2014 they put a hard cap on the annual inflation rate 5.2 billion DOGE per year - still a pretty sizable inflation rate.

Since that time though, there have been no improvements to the protocol. There are no developers who are working on it and there is no one to turn to should an error occur in the codebase.

For many in the crypto space, Dogecoin was viewed as an afterthought. A cool meme that we could joke about in forums and on Twitter. I also enjoyed the memes and had fun in the games.

However, Dogecoin has taken on a new life for itself over the past year. Thanks to the hype that has been created by the likes of Elon Musk et al, DOGE has been on one insane price ride. It’s now at all time highs and in the top 10 of CMC.

Take a look at this chart. That’s the parabolic run of DOGE over this year. Almost no activity for the past 7 years with a slight uptick in 2017 / 18 followed by this skyrocketing performance recently.

What is driving this?

Well, it’s most likely young and inexperienced investors who are piling in on apps like Robinhood. Investors that merely think that DOGE is cheap and hence “good value” without consideration to market cap. Or perhaps they are trying to play a game of chicken with the inevitable dump.

However, they should know that:

- There is no dev team
- 50% of the supply is held by 12 wallets
- Limited use cases or utility

At the beginning of the year, I explained all the other reasons as to why DOGE has the price action it does. Prices are at unsustainable levels and there will be a crash. That’s how bubbles work.

So, why do I care so much?

Well, I firmly believe that we should make informed decisions about our investments. There are many people who are riding the DOGE wave knowing full well the risks they are taking (and I have no issues with that). However, the vast majority of people don’t know these facts.

And, when many of these new investors lose their money on the DOGE bubble, it will tarnish crypto. They will paint it with the same brush and it will impact on the wide scale adoption we are all hoping to see.

I think this video by Charles Hoskinson sums it up best. Not only is it making a mockery of his life’s work but there will be regulatory repercussions from this. Young, inexperienced retail investors losing life fortunes on a meme coin is not something that will sit well with the SEC.

The last thing we need is those government bureaucrats in congress holding hearings on the “dangers of cryptocurrency” and pushing for more oversight - you know that they are looking for an excuse to do it.

So, all I hope is that those people who are jumping into Dogecoin know what it's about and know the risks that are involved. If you know anyone who is on the DOGE train without knowing how rocky the ride is, let them know

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